Faith Based Investing

Where are you storing money?



Proverbs 13:11 talks about accumulating, saying ―”he who gathers money little by little makes it grow”. And we usually use the word “diversification” when we mention Ecclesiastes 11:2 which says to “Give portions to seven, yes to eight, for you do not know what disaster may come upon the land”. There’s also the question, of course, of ―How much is enough?

As Christians we must develop a discerning about the difference between investing and hoarding. Consider the illustration of the successful farmer from Luke 12:16-21: tearing down his barns to build bigger barns.

^“And he told them this parable: “The ground of a certain rich man produced a good crop. He thought to himself, ‘What shall I do? I have no place to store my crops.’Then he said, ‘This is what I’ll do. I will tear down my barns and build bigger ones, and there I will store all my grain and my goods. And I’ll say to myself, “You have plenty of good things laid up for many years. Take life easy; eat, drink and be merry.” ‘

“But God said to him, ‘You fool! This very night your life will be demanded from you. Then who will get what you have prepared for yourself?’

“This is how it will be with anyone who stores up things for himself but is not rich toward God.”

Yet building a bigger barn, Jesus calls him a fool. I sometimes ask when I’m considering a certain goal – or helping a client to work toward a goal – ―is this a self-centered goal or a Christ-centered goal?

Do your goals concentrate on building a bigger barn or building a bigger kingdom?   What are your thoughts?  Should we build wealth for our children and grandchildren or use wealth to build churches, ministries, and help the less fortunate?

The human side of me often wrestles with this.  I want to provide for my kids but I strive to create a  legacy that passes wisdom along with wealth while also impacting the generations to come.  How about you?

A good coach can bring light to your situation

After 6 years, Tiger Woods recently made a major change.  Before you start with the infidelity jokes, I’m talking about major changes in his career – professional golf.    Tiger got to the top of his golf game with a little help from his coach.  However after six years of coaching, Tiger called it quits.

Why is Tiger Woods parting ways with his golf coach?  The reality is Tiger needed to make a move.  When something isn’t working, it is really frustrating – for everyone involved!

I talk with hundreds of people each month via the telephone, email, and in person. Money always seems to be a hot topic!  With the stock market back on a roller coaster course – people are more dazed and confused!  Many coaches, financial advisors, and stock brokers are asset gatherers not asset managers.  They have a vested interest to keep you invested in the markets even when it may not be the best choice for you.   Is your coach part of your team or do they have a hidden agenda?  Why not find an advisor who help bring light to your situation?

It may be time for you to change coaches too

Just like Tiger, it may be time for you to change coaches. The sharp ups and downs recently in the markets are a shocking reminder of what we saw in 2008 and 2009.  Don’t go back down that path! If you have found that you are not where you need to be financially or not getting the help you desire, it may be time for a coaching change! Take control of your future today.  Email me at jay@jayperoni.com for a FREE 30 minute evaluation of your financial situation!

With over 15 years of experience, I can look at your:

• Investment strategies
• Retirement plans
• Business ideas and ways to grow business
• Estate and legacy plans
• Tax efficiency (or lack thereof)
• Savings and spending
• Debt management
• And how all these tie together with your faith and values

Should you have a living trust?

from my post at ChristianPf.com

Not everyone needs a living trust. However, the larger and more complex your estate becomes, the greater your need for effective estate planning to minimize taxation and pass assets and property to those you care about most.  A living trust can be an essential tool to facilitate that planning.

Here are a few advantages of having a living trust and 5 reasons why it may make sense for you:

1. A revocable living trust trumps a basic will. It contains all the instructions on where you want your money to go, and it offers you (the trustee) additional benefits.
2. A correctly funded trust avoids probate while a will ensures probate to prove its validity. Probate will cost your beneficiaries time and money.  In certain states, the probate process can drag on for years. Additionally, a will can be made public and can be challenged in court.  A living trust preserves your family’s privacy and cannot be contested.
3. A living trust can be used to tell your love ones your wishes if you were to become severely ill, disabled, or incapacitated. While a durable power of attorney gives someone the power to act legally on your behalf, not all financial institutions will recognize it. Valid living trusts are accepted by all financial institutions. Living trusts allow other trustees such as your spouse or another alternate trustee to step in and manage your affairs if you are unable to, without court approval.
4. A living trust can also save on estate taxes if properly structured – split into two trusts upon the death of one spouse (what is commonly referred to as an AB trust). This preserves the estate tax credit of the spouse who died and the unlimited marital deduction for the remainder of the estate.
5. A living trust lets you transfer assets to your heirs with conditions attached to preserve your final wishes. This allows you to control the way your assets are distributed even after you’re gone.

So a living trust sounds perfect…well what about the downside of these trusts?

With all these advantages what could possibly be the downside?  Well, for starters, many who have simple estates may not need a trust…just now.   If you are in your 30s, 40s, or 50s, you may have another 20 plus years before you pass away.  Laws and estate tax situations change.  It may be years before any of your instructions are implemented.  Your final wishes could change several times before now and the time the Lord calls you home.

As an alternative, a well-written will and durable power of attorney may suffice until later in life. If you are married, any joint assets and property generally will pass from one spouse to another without probate.

Another downside to a trust is cost.  What costs a few hundred for a will can often cost thousands of dollars for a trust.  Is this expense justifiable at this stage of your life?  It may or may not make sense to set up a trust today.

Be careful if you have setup a trust.  Even if setup, some people never fund them. Meaning, they have the trust drawn up, but they never transfer assets from their name into the name of the trustee of the trust.  I have seen far too many people make this common mistake! They properly fill out the paperwork or say they’ll get around to it “someday.” They then pass away without placing their bank accounts, investments, real estate, etc. into the trust. This would then expose those assets to probate and defeat the whole point of the trust.  You need someone to look over your estate planning documents to make sure they are in good order.

It is often wise to have both a will and a trust.

Most likely, you would not put all of your assets into a living trust. There could be some assets outside of your trust that could be left in a will such as jewelry, family heirlooms, or other sentimental items. You could also use a document such as a pour over will to transfer any remaining assets outside the trust into the trust.  This would allow those assets to be distributed according to the terms of the trust. So as you can see, wills and trusts can often complement one another.

What makes the most sense for your situation?

In order to find out what makes the most sense for you personally, I advise talking with a Certified Financial Planner™ and an estate planning attorney.  Form a team to help you implement your final wishes and pass wealth in the most tax advantageous way.

Have you set up a living trust or a will?

“We cannot control the winds, but we can adjust the sails.”

Tonight I went to a leadership conference at Seacoast Church in Mount Pleasant, SC.  As I sat there listening about how great leaders have BIG visions, I saw something that hit me:  leader-ship. As in we are leaders of a ship.  What does your ship look like?  For some it may be that they are the leader of a church, an organization, a company, a family, or even one’ own finances.  Leadership means many things to many different people; but the way I look at leadership is it is about creating something extraordinary through having a big vision and critical implementation.   Alone, you cannot accomplish your vision, but with others, you can accomplish something much greater than yourself.

I learned this lesson the hard way this week.  I faced a major financial and leadership decision.   Common sense said to do what made the most financial sense.  Yet God shaped my heart a different way.   He showed me fairness, justice, and to give my complete trust to Him.  Though we often try to lead with our own will and power, it is when we give Him full authority He does His best work through us!

Are you struggling financially, spiritually, physically?  Whatever it is, give it to God.  He is trying to teach you something!  As a friend pointed Deuteronomy 8:3 out to me during my struggles this week:

“He humbled you, causing you to hunger and then feeding you with manna, which neither you nor your fathers had known, to teach you that man does not live on bread alone but on every word that comes from the mouth of the LORD.”  

Sometimes we try to take matters into our own hands and forget to include God in our plans.  Is that what a good leader should do?  Even the wisest leaders seek counsel.  What better wisdom than the Word of God?  Yet, we often forget to go to ultimate source of advice!  He offers all the wisdom necessary to become a great leader.

Good leadership takes courage, a willingness to admit your wrong, and an ability to inspire people.   Do you inspire?  Whether it’s your church, your company, or even your own family?  Do those along for the ride know where you’re heading?  Do you know? 

I always say dream big or go home.  Meaning if your dreams are not big enough, you risk missing the greatest blessings God has for you.  Depending on how big you see God will ultimately determine how He uses you. If you see Him as a small God, you will accomplish little, but if you see Him as He truly is, the HUGE God who can accomplish anything through you, the sky is the limit.   So what kind of leader will you become?    I’d love to hear your thoughts on leadership.

In case you hadn’t heard it, here’s a joke that puts things in perspective:

A very wealthy man decided to prove the quote, “You can’t take it with you”, wrong. Before he died he requested that his gold be buried with him. Sure enough after his death he found himself in heaven along with his gold. He was so excited that he had actually taken it with him. He went up to St. Peter to enter the gates and exclaimed “Look at this, you can take it with you.” Peter looked at the gold in the mans hand and asked “Why would you want to bring pavement with you?”

In heaven, the streets will be made of gold.  Invest in eternal wealth today!

photo credit: BullionVault

Those three little letters signify some very high standards in financial planning.

“Certified Financial Planner” – what does that title really mean? When you search for a financial advisor, it means everything. Let me explain why the CFP designation is so important.

Today, the financial world is full of credentials and designations. Some are respected, some aren’t. The CFP designation is easily the most respected. You really have to earn it. (There are some financial credentials simply conveyed to people after the completion of a glorified sales course. The CFP designation is not one of them.)

It denotes education. To become a Certified Financial Planner practitioner, you have to study financial planning at a college or university (or at the very least, through an educational program) that offers a comprehensive financial planning curriculum. You also have to pass a 10-hour exam administered over two days (kind of like a bar exam) which covers financial planning, tax planning, employee benefits and retirement planning, estate planning, investment management and insurance topics.

It reflects ethical and experiential standards. Before you can be certified as a CFP, you must pass a strict ethics review and agree to work by the CFP Board’s Code of Ethics and Professional Responsibility. As a CFP practitioner, you must put the interests of the client first, and act “fairly and diligently” when providing financial planning advice and services. Those services must be based on the client’s needs, and delivered with objectivity and integrity. You must also have at least three years of experience working within the financial planning field before you can even earn the CFP certification.

You must maintain these standards. As a CFP certificant, you have to be recertified every two years. That requires at least 30 hours of continuing education, so that you may stay informed of the latest developments affecting the financial planning profession. Two of those 30+ hours must be spent studying the CFP Board’s Code of Ethics and Professional Responsibility or Financial Planning Practice Standards.

This is why the CFP designation is so respected. Knowing all this, would you settle for any less qualified financial advisor? I doubt it.

The critical difference. Many people today call themselves “financial planners” without having this kind of experience and knowledge. Many of them work with a sales-based mentality. Often, they will suggest an investment product as a financial solution. Quite often, they get a nice commission off the sale of that product.

On the other hand, CFP practitioners know that investments are simply components in an overall financial plan, not financial solutions in themselves. We have the education and experience to create integrated financial plans using not only investments, but also strategies for tax reduction, wealth accumulation, wealth preservation and tax-efficient wealth transfer. We have the knowledge to plan for the long-term goals of our clients, and the experience to implement, oversee and revise these plans through the years.

Choose a CFP. If you are searching for financial planning advice, you should first see a Certified Financial Planner practitioner. Talk to a CFP practitioner today, and enjoy the confidence that comes from meeting with a truly educated and qualified financial advisor.